Google Reduces Nexus One “Equipment Recovery Fee”

ERF_150_google_wm

The FCC has been eye-balling the four major U.S. carriers regarding Early Termination Fee’s and when Google dropped their bombshell, it certainly raised some eyebrows. Thankfully, Google has thought twice about their own ERF on the Nexus One. Starting today, Google has reduced the “Equipment Recovery Fee” on the HTC Nexus One from $350 to $150. While its better and a recognition of the disapproval of the original outrageous fee, all the major players still have a long way to go to solving this issue.

Still, if you’re wanting to cancel your T-Mobile service (You had better not) within the first 120 days you can pay $150 plus T-Mobile’s $200 ETF, costing you a total of $350, whereas before it was $550. Nice move Google, but how about getting rid of the ERF all together? Statement from Google courtesy of the Wall Street Journal below:

“A Google representative said the company had been working with T-Mobile to lower the equipment fee.”

“Google’s overall financial philosophy with regard to operator service plans remains unchanged: We make no profit from commissions from operators or from equipment recovery fees, and our recovery fees are based on operator charges to Google for early termination of service,” the company said in a statement.

Feel free to voice your opinions in the comments!

WallStreetJournal

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  • watbetch

    They can’t and shouldn’t get rid of it. Hell reducing it is too much..

  • SalM

    Well, doesn’t that then mean you can grab it subsidized for $179, make account changes to merge the new account w/ a family plan, and at worst be hit w/ a $150 fee from Google, making the phone fee $329 in the end??

    Why don’t they just expand the upgrade options?

  • ItsMichaelNotMike

    I think it’s bad business whenever a company imposes penalties and fines. Last year banks made close to $50 billion in the very profitable overdraft fee industry.
    Credit card companies also made in the billions on over limit fines and late payment penalties.

    I just think it’s the wrong message to send to consumers. It’s a very short sighted way to do business, all in the name of profits.

    Don’t have a problem with carriers getting back the subsidized discount part of a phone purchase given to a customer, but that should be prorated over time and also include a further discount for depreciation. If a carrier does not do this, then this is nothing different than a penalty or fine, the same as banks and credit card companies are imposing.

    Personally, I like T-Mobile’s new Even More Plus plan. I just moved from a loyalty, contracted plan (two lines) to the non-contracted Plus plan. I then bought a BlackBerry Bold 9700 on a 20 month payment plan (interest free). While I paid full price for the phone, I am only paying $20 a month for it.

    My understanding is that this is how they do it in Europe, no contracts, no ETFs, no subsidized phones. Makes sense to me.

    A company should earn my business, not force me to do business with them and when they deliver lousy service, force me through fines and penalties to stay with them.

    IMHO Google showed its true colors with this phone and fees. It ain’t pretty. I really feel like when dealing with Google I have to sleep with one eye open, so to speak, and after shaking its hand I have to count my fingers to make sure they are all still there.

    • analog spirit

      ^ Well said, Michael.

  • mike

    so what if u get the phone at the discount which is 180, and then one u get the phone wait a day or two and cancel service with tmobile under customers remorse. if u cancel service within 14 days within tmobile there is no $200etf. the only fee u will be charged is the $150 fee from google. so u will only be paying the 180 for the phone and the 150 equaling the low cost of $330.

    • eYe

      Sounds nice in theory but…

      Cancellation and Return Policy. For contracts of 1 year or more, I may cancel my service without paying a termination fee if I return all devices I acquired with my activation within 14 days from my activation (Return Period).

      …taken from T-mobile’s terms of services. Part of it requires that you return device to them. Not sure how it works when you buy your device from Google. If anyone has a solid info on this – I would appreciate it. I wouldn’t mind owning N1 for $330 (well, $365 since there’s an activation fee).

  • T.P.

    Nice but how about making the phone available to everyone! Sorry I’m not into paying ridiculous amounts of money for a phone. Just me, I’m not hating on those who does. Just feel that T-Mobile doesn’t get respect. Google showed them to me the ultimate disrespect in how they handled this.

  • mike

    i work at a tmobile corporate store and people cancel all the time without returning the device. tmobile customer care doesnt check to see if the handset is returned before canceling under remorse.

  • alex76

    Hmmm, so basically I can open a new line, get the nexus one for $180, wait a week, cancel that line with Tmo, then wait for google to charge me $150 and not return the nexus to tmo (obviously)?? Sounds good to me so as long tmo doesnt charge there own etf on top of that.

  • mike

    alex76

    just as long as u cancel within the 14 day remorse period you good s as gold

  • Michael Meyer

    Its very simple … A company pays for a top of the line piece of equipment that costs over 400$ to make/buy then they turn around and sell it for 179$ on a contract…. there commission t-mobile pays out makesup for the loss but what if that customer cancel within 4 months of buying from google? T-mobile takes back the commission they paid out for that activation and now google lost the commission AND the phone that can make a company crumble… its that simple a $150 equipment recovery is MORE then reasonable from a business perspective your nieve and ignorant if you think they shouldnt have any fee at all